New York Financial Services Department issued a digital currency license draft

New York Financial Services Department issued a digital currency license draft

New York Financial Services Department has released a digital currency license (BitLicenses) draft, which will change the digital currency in the United States trade faces.

Now, business conduct any bitcoin transaction processing must record the customer’s name and address, and accept the Ministry of finance behavior inspection.

Businesses must also provide a 100% margin, finally, the financial services sector will be strictly on the digital currency license (BitLicenses) security audit of the company, in order to prevent the birth of another Mt.Gox.

The biggest change is the use of encryption of digital money service will become no longer anonymous in New York. Anonymity was a bitcoin transaction early participants valued, but for the financial sector as well as members of Congress, the anonymity of bitcoin transactions is their biggest concern at hearings earlier this year there are many members expressed a strong sense of disgust.

The following is the main points of the draft, the draft will have a 45 day comment period, during which the New York financial services sector will solicit public opinion.

The main contents of the bill is a digital currency regulatory framework, including consumer protection, network security rules of anti money laundering and digital currency business.

According to the New York State Administrative Procedure Act (SAPA) regulations, financial services regulatory rules on digital currency will open in July 23, 2014, and began a 45 day public comment period, according to the feedback from the public for additional review and revision.

In addition, the Financial Services Department issued a copy of the relevant transaction regulations today in reddit, the financial services sector is mainly engaged in the business of virtual currency for the company:

The protection of consumer assets: each enterprise must hold a consumer digital currency held by virtual currency with the same number of species and (100% margin), the company prohibits the sale, transfer, distribution, lending, mortgage pledge or other virtual currency way. Every Licensee to guarantee the customer to hold dollar bonds requires financial services or the amount of trust account.

Consumer complaints policy : each enterprise must establish and maintain written policies and procedures, in order to solve the fairness and timeliness of consumer complaints.

Virtual currency income Any transaction is completed, each enterprise shall provide the following information to the customer receipt: (1) the name and contact information, including complaints and answering telephone number; (2) the date, type, value,
accuracy and transaction time; (3) the fees; (4) if the exchange rate. Applicable; (5) the licensee does not pay or delay in delivery of the responsibility statement; (6) the tax rebate policy of licensee.

Open to the consumer: The company must make consumers aware of potential risks related to digital currency, including digital currency transactions are irreversible fact, digital currency relative to it would be a great wave of qualitative legal tender and risk factors.

Anti money laundering compliance As part of the anti money laundering compliance program, each enterprise should keep all of the following transactions involving information, payment, receipt, exchange, transfer, sale of all virtual currency transactions: (1) the identity of the parties and the physical address; (2) trading volume or value; (3) the transaction is initiated and completed date; (4) to verify that the account holder. The report alleged fraud and illegal behavior will mean money laundering transactions, tax evasion, or other criminal activities.

Network security plan: Each holder must maintain the implementation of a network security plan, including the identification of internal and external risk of network penetration testing each enterprise requires electronic system, to carry out at least once a year, and the vulnerability assessment of these systems is to conduct a quarterly.

Cisos: Each licensee is required to appoint a qualified staff as chief information security officer, responsible for the supervision and implementation of licensed network security procedures and Strategies of the people.

Books and records: The licensee must maintain a certain accounting books and records, including the investigation of related transaction information, the bank statement etc..

Report and financial disclosure and audit requirements: 45 day comment period after each enterprise must to the financial services sector to provide quarterly financial reports and annual financial report.

Independent Financial Services Department examination: The licensee needs to carry on the examination, to ensure the licensee management of the financial situation, policy, and understand the laws and regulations.

Capital requirements: Licensee needs through financial services based on a variety of factors and the establishment of the capital requirements, including the Licensee’s total assets and liabilities structure.

Compliance officer: Each licensee needs to make a qualified person as a compliance officer.

The transition period: the license from the proposed regulations take effect on accepting applications. Those who have engaged in virtual currency enterprises in the effective date regulations will have a 45 day transition period. The regulatory authorities will be in the application submitted within 90 days after the approval or rejection of the license application.

Business continuity and disaster recovery: Every Licensee shall establish business continuity and disaster recovery plan.

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